Bill Text: CA AB1348 | 2023-2024 | Regular Session | Amended

California Assembly Bill 1348

Bill Title: State government: Controller: claims audits.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed) 2023-09-01 - In committee: Held under submission. [AB1348 Detail]

Download: California-2023-AB1348-Amended.html

Amended IN Assembly May 18, 2023

Amended IN Assembly March 20, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill

No. 1348

Introduced by Assembly Member Grayson

February 16, 2023

An act to amend Section 925.6 of the Government Code, relating to state claims.

LEGISLATIVE COUNSEL'S DIGEST

AB 1348, as amended, Grayson. State government: Controller: claims audits.

Existing law, the Government Claims Act, generally requires the presentation of all claims for money or damages against local public entities and the state. Existing law provides for the presentation of a claim for which appropriations have been made, or for which state funds are available, under that act to the Controller, in the form and manner prescribed by the general rules and regulations adopted by the Department of General Services. Existing law, with specified exceptions, prohibits the Controller from drawing a warrant for any claim until it has been audited in conformity with law and the general rules and regulations adopted by the Department of General Services governing the presentation and audit of claims.

This bill would ~~require~~ authorize the Controller to conduct, unless prohibited by the provisions of a state ballot proposition passed by the electorate, financial and compliance audits as the Controller’s office deems as necessary for purposes of ensuring that any expenditures, regardless of the source or fund from which the warrants for claims are drawn, are expended in a manner consistent with the law and the voters’ intent. The bill would also ~~require~~ authorize the Controller to conduct any audits necessary to carry out their constitutional and statutory duties and responsibilities under the law. The bill would, among other things, authorize the Controller to recover their costs in conducting these and the above-described audits from amounts appropriated for purposes of carrying out these audits, except as described. The bill would ~~require~~ require, if an audit is conducted as specified, the Controller to provide a report with specified information from these audits to the Legislature by June 30 ~~of each year~~ following the completion of the audit and would require the Controller to allow all auditees in the report a reasonable period of time to review and comment on the section of the report relating to the auditee, as described. The bill would make related legislative findings and declarations.

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO

The people of the State of California do enact as follows:

SECTION 1.

The Legislature finds and declares the following:

(a) It is the intent of the Legislature to promote accountability and transparency over funds approved by voters through ballot propositions by establishing a program requiring financial and compliance audits of money required to be appropriated or spent pursuant to the terms of the proposition.

(b) It is the intent of the Legislature that, unless otherwise stated in the initiative, the Controller shall have the primary responsibility for implementing and overseeing the program.

(c) It is the intent of the Legislature that all expenditures of taxpayer dollars that are approved by voters through ballot propositions, regardless of the specific fund, be reviewed and audited on a regular basis as part of the program for purposes of ensuring that the expenditures are made in a manner consistent with voter intent.

SEC. 2.

Section 925.6 of the Government Code is amended to read:

925.6.

(a) (1) Except as otherwise provided in subdivisions (b) and (e), the Controller shall not draw their warrant for any claim until the Controller has audited that claim in conformity with law and the general rules and regulations adopted by the department, governing the presentation and audit of claims. If the Controller is directed by law to draw their warrant for any purpose, the direction is subject to this section.

(2) (A) Unless prohibited by the provisions of a state ballot proposition passed by the electorate, the Controller ~~shall~~ may also conduct financial and compliance audits as the Controller’s office deems as necessary for purposes of ensuring that any expenditures, regardless of the source or fund from which the warrants for claims are drawn, are expended in a manner consistent with the law and the voters’ intent.

(B) The Controller ~~shall~~ may also conduct any audits necessary to carry out their constitutional and statutory duties and responsibilities under the law.

(C)Unless prohibited by the provisions of a state ballot proposition passed by the electorate, the Controller shall recover their costs in conduct audits pursuant to this section from amounts appropriated for purposes of carrying out these audits.
~~(D)~~

(C) This section shall not be construed to authorize any entity or individual, including, but not limited to, any state or local agency, subcontractor, or subrecipient of a claim, to constrain, in any manner, the Controller from carrying out any audits.

~~(E)The~~

(D) If the Controller conducts an audit pursuant to subparagraph (A) or (B), the Controller shall provide a report to the Legislature, in compliance with Section 9795, by June 30 ~~of each year~~ following the completion of the audit as follows:

(i) The report shall contain information regarding programs that are not in compliance with any state ballot proposition passed by the electorate and any applicable regulations.

(ii) The report shall categorize audit exception by types and shall identify the reasons for the exceptions.

(iii) The report shall include the Controller’s recommendations to the Legislature as to what action should be taken, based on the content of the report.

~~(F)~~

(E) Before issuing the report required in subparagraph ~~(E),~~ (D), the Controller shall allow all auditees in the report a reasonable period of time to review and comment on the section of the report relating to the auditee.

(b) Notwithstanding subdivision (a), the Assembly Committee on Rules, the Senate Committee on Rules, and the Joint Rules Committee, in cooperation with the Controller, shall adopt rules and regulations to govern the presentation of claims of the committees to the Controller. The Controller, in cooperation with the committees, shall adopt rules and regulations governing the audit and recordkeeping of claims of the committees. All rules and regulations shall be adopted by January 31, 1990, shall be published in the Assembly and Senate Journals, and shall be made available to the public.

(c) Rules and regulations adopted pursuant to subdivision (b) shall not be subject to the review by or approval of the Office of Administrative Law.

(d) Records of claims kept by the Controller pursuant to subdivision (b) shall be open to public inspection as permitted by the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1).

(e) (1) Notwithstanding subdivision (a), the Controller shall draw their warrant for any claim submitted by the Department of Housing and Community Development to advance the payment of funds to a vendor selected pursuant to Section 50897.3 of the Health and Safety Code, based on approved applicants associated with Chapter 17 (commencing with Section 50897) of Part 2 of Division 31 of the Health and Safety Code. Funds made available for advance payment pursuant to this subdivision shall not exceed 25 percent of the original amount allocated for the program described in Chapter 17 (commencing with Section 50897) of Part 2 of Division 31 of the Health and Safety Code at any given time.

(2) The vendor described in paragraph (1) shall be the fiscal agent on behalf of the Department of Housing and Community Development and shall be responsible for maintaining all records of claims for audit purposes.

(3) Unless otherwise expressly provided, this subdivision shall remain operative so long as funds are made available pursuant to Chapter 17 (commencing with Section 50897) of Part 2 of Division 31 of the Health and Safety Code or as otherwise provided under federal law.